RESTATED SHAREHOLDER AGREEMENT
Exhibit
8
RESTATED
SHAREHOLDER AGREEMENT dated as of November 21, 2008 and effective as of October
13, 2008 (the “Agreement”) between Banco
Santander S.A., a Spanish sociedad anónima (“Parent”), and each of the
individuals or entities listed on a signature page hereto (each, a “Shareholder”).
WHEREAS,
in order to induce Parent to enter into the Transaction Agreement (the “Transaction Agreement”), dated
as of October 13, 2008 (“Effective Date”), with
Sovereign Bancorp, Inc., a Pennsylvania corporation (the “Company”), Parent has
requested the Shareholders, and each Shareholder has agreed, to enter into this
Agreement with respect to all shares of common stock, no par value per share, of
the Company that such Shareholder beneficially owns (the “Shares”).
WHEREAS,
Parent and the Shareholders hereby amend and restate the original Shareholder
Agreement, dated the Effective Date (the “Original Agreement”), to
provide for certain technical corrections thereto.
NOW,
THEREFORE, the parties hereto agree as follows:
ARTICLE
1
Voting
Agreement
Section
1.01 . Voting
Agreement. Each Shareholder hereby agrees to vote (or cause to
be voted) or exercise its right to consent (or cause its right to consent to be
exercised) with respect to all Shares beneficially owned by such Shareholder
that such Shareholder is entitled to vote at the time of any vote or action by
written consent to approve and adopt the Transaction Agreement, the
Reincorporation Merger, the Share Exchange and all agreements related to the
Reincorporation Merger and the Share Exchange (collectively, the “Transactions”), at any meeting
and at any adjournment thereof, at which such Transaction Agreement and other
related agreements (or any amended version thereof) are submitted for the
consideration and vote of the shareholders of the Company. Each
Shareholder hereby agrees that it will not vote any Shares in favor of, or
consent to, and will vote against and not consent to, the approval of any
(i) Acquisition Proposal, (ii) reorganization, recapitalization,
liquidation or winding-up of the Company or any other extraordinary transaction
involving the Company, or (iii) corporate action the consummation of which would
in any respect frustrate the purposes, or prevent or delay, hinder, interfere
with or adversely affect in any respect the consummation, of the transactions
contemplated by the Transaction Agreement.
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Section
1.02 Irrevocable Proxy. Each
Shareholder hereby revokes any and all previous proxies granted with respect to
the Shares. By entering into this Agreement, to the maximum extent
permitted by applicable law, each Shareholder hereby grants a proxy appointing
Parent as such Shareholder’s attorney-in-fact and proxy, with full power of
substitution, for and in such Shareholder’s name, to vote, express consent or
dissent, or otherwise to utilize such voting power in the manner contemplated by
Section 1.01 above as Parent or its proxy or substitute shall, in Parent’s sole
discretion, deem proper with respect to the Shares. The proxy granted
by each Shareholder pursuant to this Article 1 is irrevocable, is coupled with
an interest and is granted in consideration of Parent entering into this
Agreement and the Transaction Agreement and incurring certain related fees and
expenses. The proxy granted by each Shareholder shall be revoked only
(i) upon the termination of this Agreement in accordance with its terms or
(ii) with respect to Shares that are sold, assigned, transferred or otherwise
disposed of following the Record Date in accordance with the terms of this
Agreement, upon such sale, assignment, transfer or other disposition; provided that such revocation
shall only be effective with respect to matters for which the relevant record
date is the date of, or any date following, such sale, assignment, transfer or
other disposition.
ARTICLE
2
Representations
and Warranties of Shareholders
Each
Shareholder, severally but not jointly as to any other Shareholder, represents
and warrants to Parent (it being expressly understood that the representations
and warranties contained in this Agreement shall be made only as of the
Effective Date):
Section
2.01 . Corporation
Authorization. If such Shareholder is not an individual, the
execution, delivery and performance by such Shareholder of this Agreement and
the consummation by such Shareholder of the transactions contemplated hereby are
within the corporate, limited liability company, partnership or trust powers of
such Shareholder and have been duly authorized by all necessary
action. This Agreement constitutes a valid and binding Agreement of
such Shareholder. If such Shareholder is married and the Shares set
forth on the signature page hereto opposite such Shareholder’s name constitute
community property under applicable laws, this Agreement has been duly
authorized, executed and delivered by, and constitutes the valid and binding
agreement of, such Shareholder’s spouse. If this Agreement is being
executed in a representative or fiduciary capacity, the Person signing this
Agreement has full power and authority to enter into and perform this
Agreement.
Section
2.02 . Non-Contravention. The
execution, delivery and performance by such Shareholder of this agreement and
the consummation of the
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transactions
contemplated hereby do not and will not (i) if such Shareholder is not an
individual, violate the certificate of incorporation or bylaws of or similar
organizational documents of such Shareholder, (ii) violate any applicable law,
rule, regulation, judgment, injunction, order or decree, (iii) except as
contemplated by the Investment Arrangements and the Settlement Agreement,
require any consent or other action by any Person under, constitute a default
under, or give rise to any right of termination, cancellation or acceleration or
to a loss of any benefit to which such Shareholder is entitled under any
provision of any agreement or other instrument binding on such Shareholder or
(iv) result in the imposition of any Lien on any asset of such
Shareholder. For purposes of this Agreement, the term “Investment Arrangements” means
the agreements and other documentation pursuant to which any Shareholder
beneficially owns Shares, including any applicable investment agreements,
managed account agreements and limited partnership agreements. For
purposes of this Agreement, the term “Settlement Agreement” means
the Settlement Agreement, dated as of March 22, 2006, by and among Relational
Holdings, LLC, Relational Investors LLC, Xxxxx X. Xxxxxxxxx, Xxxxx X.
Xxxxxxxxxx, certain investment partnerships identified on Annex A thereto and
Sovereign Bancorp, Inc.
Section
2.03 . Ownership of
Shares. Except as contemplated by the Investment Arrangements
and the Settlement Agreement, such Shareholder is the beneficial owner of the
Shares, free and clear of any Lien and any other limitation or restriction
(including any restriction on the right to vote or otherwise dispose of the
Shares). Except as contemplated by the Investment Arrangements, the
Settlement Agreement and this Agreement, none of the Shares is subject to any
voting trust, proxy or other agreement or arrangement with respect to the voting
of such Shares. Prior to June 30, 2009, the number of Shares subject
to any voting trust, proxy or other agreement or arrangement with respect to the
voting of such Shares or subject to any obligation to sell (including short
sell), assign, transfer, encumber or otherwise dispose of under the Investment
Arrangements does not exceed 6,489,050.
Section
2.04 . Reliance. Such
Shareholder understands and acknowledges that Parent is entering into the
Transaction Agreement in reliance upon such Shareholder’s execution, delivery
and performance of this Agreement.
Section
2.05 . Total
Shares. Except for the Shares set forth on the signature page
hereto, as of the date of this Agreement such Shareholder does not beneficially
own any (i) shares of capital stock or voting securities of the Company, (ii)
securities of the Company convertible into or exchangeable for shares of capital
stock or voting securities of the Company or (iii) options or other rights to
acquire from the Company any capital stock, voting securities or securities
convertible into or exchangeable for capital stock or voting securities of the
Company.
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Section
2.06 . Finder’s
Fees. No investment banker, broker, finder or other
intermediary is entitled to a fee or commission from Parent or the Company in
respect of this Agreement by reason of any arrangement or agreement made by such
Shareholder.
ARTICLE
3
Representations
and Warranties of Parent
Parent
represents and warrants to each Shareholder:
Section
3.01 . Corporation
Authorization. The execution, delivery and performance by
Parent of this Agreement and the consummation by Parent of the transactions
contemplated hereby are within the corporate (or similar) powers of Parent and
have been duly authorized by all necessary corporate (or similar)
action. This Agreement constitutes a valid and binding agreement of
Parent.
ARTICLE
4
Covenants
of Shareholders
Shareholder
hereby covenants and agrees that:
Section
4.01 . No Transfer of, Proxies
for, or Encumbrances on, Shares. (a) Except pursuant to the
terms of this Agreement or as required by the Investment Arrangements, no
Shareholder shall (nor permit any person under such Shareholder’s control to),
without the prior written consent of Parent, directly or indirectly,
(i) grant any proxies or enter into any voting trust or other agreement or
arrangement with respect to the voting of any Shares or (ii) sell (including
short sell), assign, transfer, encumber or otherwise dispose of, or enter into
any contract (including any hedging or derivative agreement or other similar
agreement), option or other arrangement (including any profit sharing
arrangement) or understanding with respect to the direct or indirect sale
(including short sale), assignment, transfer, encumbrance or other disposition
of, any Shares, in each case on or prior to the earlier of the day following the
Record Date and June 30, 2009 (the “Sale Release
Date”). On and after the Sale Release Date, no such sale,
assignment, transfer, encumbrance, disposition, entering into of any contract,
option or other arrangement or understanding with respect to the direct or
indirect sale, assignment, transfer, encumbrance or other disposition of any
Shares shall be made by any Shareholder other than in (x) open market sales not
exceeding in any one trading day 20% of the Company’s average daily volume for
the previous 30 trading days, or (y) privately negotiated sales, provided that
the transferee immediately following any such transaction would not, together
with such transferee’s Affiliates, beneficially own in the aggregate 2% or more
of the Company’s outstanding voting securities. For purposes hereof,
the term “Record Date”
shall mean the first record date established by the board
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of
directors of the Company (with the approval and consent of at least one director
designated by Parent) for the meeting of the Company’s shareholders contemplated
by Section 10.02 of the Transaction Agreement (the “Record Date”).
(b) For the
avoidance of doubt, Parent hereby agrees and confirms that following the Sale
Release Date, each Shareholder may take any action referenced in clause (ii) of
Section 4.01(a) with respect to any or all of the Shares, and that upon and to
the extent of such sale, assignment, transfer, encumbrance, or other
disposition, the Shares so sold, assigned, transferred, encumbered or disposed
of shall no longer be subject to the terms of this Agreement, except (i) to the
extent expressly agreed by the Person to whom the Shares are so sold, assigned,
transferred or disposed of or for whose benefit the encumbrance arises and (ii)
to the extent of the irrevocable proxy granted by each Shareholder pursuant to
the terms and conditions of Section 1.02. Parent acknowledges that,
pursuant to the Investment Arrangements, the Shareholders may be required to
transfer to clients, or may, upon the termination of an investment advisory
relationship or otherwise, dispose or fail to retain, beneficial ownership of
Shares. Notwithstanding the foregoing, each Shareholder will use
reasonable best efforts to cause retain through the Sale Release Date ownership,
custody and/or control of all of the Shares and, to the extent necessary, to
influence any other Person having voting authority over any of the Shares to
exercise that authority in a manner consistent with this
agreement. Subject to the next sentence of this paragraph, any such
loss of beneficial ownership of Shares pursuant to the Investment Arrangements
shall not be a breach of this Section 4.01, and upon and to the extent of such
transfer or other disposition of beneficial ownership, such Shares shall no
longer be subject to the terms of this Agreement. Notwithstanding
anything in this Agreement to the contrary, the Shareholders shall ensure that,
in the aggregate, they beneficially own at least 52,500,000 Shares on the Record
Date; provided that the Record Date occurs on or before June 30,
2009.
Section
4.02 . Other
Offers. Subject to Section 5.01, each Shareholder shall not,
directly or indirectly, (i) take any action to solicit or initiate any
Acquisition Proposal or (ii) engage in negotiations with, or disclose any
nonpublic information relating to the Company or any of its Subsidiaries or
afford access to the properties, books or records of, or relating to, the
Company or any of its Subsidiaries to, any Person that may be considering
making, or has made, an Acquisition Proposal or has agreed, or may be
considering whether to agree, to endorse an Acquisition
Proposal. Each Shareholder will promptly notify Parent after receipt
of an Acquisition Proposal or any indication that any Person is considering
making an Acquisition Proposal or any request for nonpublic information relating
to the Company or any of its Subsidiaries or for access to the properties, books
or records of, or relating to, the Company or any of its Subsidiaries by any
Person that may be considering making, or has made, an
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Acquisition
Proposal and will keep Parent fully informed of the status and details of any
such Acquisition Proposal, indication or request.
Section
4.03
Appraisal
Rights. Each Shareholder agrees not to exercise any rights to
demand appraisal of any Shares which may arise with respect to any of the
transactions contemplated by the Transaction Agreement.
ARTICLE
5
Miscellaneous
Section
5.01 .
Action in Shareholder
Capacity Only. The parties acknowledge that this Agreement is
entered into by each Shareholder solely in his or its capacity as the beneficial
owner of the Shares beneficially owned by him or it, and nothing in this
Agreement shall in any way restrict or limit any action taken or to be taken (or
failure to act) by such Shareholder or such Shareholder’s principals or other
controlling persons, as applicable, in any capacity as a director or officer of
the Company and the taking of any actions (or failure to act) by such
Shareholder or such other Persons in any capacity as an officer
or director of the Company will not be deemed to constitute a breach
of this Agreement, regardless of the circumstances related thereto.
Section
5.02 Documentation and
Information. Each Shareholder consents to and authorizes the
publication and disclosure by Parent of such Shareholder’s identity and holding
of Shares, the nature of such Shareholder’s commitments, arrangements and
understandings under this Agreement (including, for the avoidance of doubt, the
disclosure of this Agreement) and any other information that is required to be
disclosed by Applicable Law in any press release, the Company Proxy Statement
(including all schedules and documents filed with the SEC), or any other
disclosure document or registration statement in connection with the
Reincorporation Merger, the Share Exchange and any transactions contemplated by
the Transaction Agreement; provided that each Shareholder is provided with a
reasonable opportunity to review and comment on any such
disclosure. Each Shareholder agrees to promptly notify Parent of any
required corrections with respect to any information supplied by such
Shareholder specifically for use in any such disclosure document, if and to the
extent that such Shareholder has knowledge that any such information shall have
become false or misleading in any material respect.
Section
5.03 .
Other Definitional and
Interpretative Provisions. Unless specified otherwise, in this
Agreement the obligations of any party consisting of more than one person are
joint and several. The words “hereof”, “herein” and “hereunder” and
words of like import used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. The
captions herein are included for convenience of reference only and shall be
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ignored in
the construction or interpretation hereof. References to Articles and
Sections are to Articles and Sections of this Agreement unless otherwise
specified. Any singular term in this Agreement shall be deemed to
include the plural, and any plural term the singular. Whenever the
words “include”, “includes” or “including” are used in this Agreement, they
shall be deemed to be followed by the words “without limitation”, whether or not
they are in fact followed by those words or words of like
import. “Writing”, “written” and comparable terms refer to printing,
typing and other means of reproducing words (including electronic media) in a
visible form. References to any agreement or contract are to that
agreement or contract as amended, modified or supplemented from time to time in
accordance with the terms hereof and thereof.
Section
5.04.
Amendments. Any provision of this Agreement may be amended or
waived if, but only if, such amendment or waiver is in writing and is signed, in
the case of an amendment, by each party to this Agreement or in the case of a
waiver, by the party against whom the waiver is to be effective.
Section
5.05 Termination. (a) Subject
to paragraph (b) of this Section 5.05, this Agreement shall terminate upon the
earlier of:
(i) the
Exchange Effective Time;
(ii) the mutual
consent of Parent and the Shareholders; and
(iii) the
termination of the Transaction Agreement pursuant to its terms.
In
addition, except as expressly stated to the contrary in this Agreement, the
terms of this Agreement shall not apply to any Shares that are sold, assigned,
transferred, encumbered or disposed of on or following the Sale Release Date in
accordance with Section 4.01(a).
(b) Upon
termination of this Agreement, the rights and obligations of all the parties
will terminate and become void without further action by any party except for
the provisions of this Article 5, which will survive such termination, and any
provision of this Agreement which by its terms survives such
termination.
Section
5.06 . Expenses. All
costs and expenses incurred in connection with this Agreement shall be paid by
the party incurring such cost or expense.
Section
5.07 . Successors and Assigns;
Third Party Beneficiaries. The provisions of this Agreement
shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns; provided that no party may
assign, delegate or otherwise transfer any of its rights or obligations under
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this
Agreement without the consent of the other parties hereto, except that Parent
may transfer or assign its rights and obligations to any controlled Affiliate of
Parent. For the avoidance of doubt, any sale, assignment, transfer,
encumbrance or disposition of Shares permitted by Section 4.01(a) shall not be
regarded as an assignment of this Agreement and no purchaser, assignee,
transferee, pledge or recipient of such Shares shall be regarded as a successor
of any Shareholder under this Agreement or have any responsibility or be subject
to any liability under this Agreement. Nothing in this Agreement,
express or implied, is intended to confer upon any Person other than the parties
hereto and their respective successors and assigns any rights or remedies under
or by reason of this Agreement.
Section
5.08 . Governing
Law. This Agreement shall be construed in accordance with and
governed by the laws of the Commonwealth of Pennsylvania, without regard to
principles of conflicts of law.
Section
5.09 . Consent To
Jurisdiction; Jury Trial.(a) The parties hereto agree that any suit,
action or proceeding seeking to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions
contemplated hereby shall be brought in the United States District Court for the
Southern District of New York or any New York State court sitting in New York
City, so long as one of such courts shall have subject matter jurisdiction over
such suit, action or proceeding, and that any cause of action arising out of
this Agreement shall be deemed to have arisen from a transaction of business in
the State of New York, and each of the parties hereby irrevocably consents to
the jurisdiction of such courts (and of the appropriate appellate courts
therefrom) in any such suit, action or proceeding and irrevocably waives, to the
fullest extent permitted by law, any objection that it may now or hereafter have
to the laying of the venue of any such suit, action or proceeding in any such
court or that any such suit, action or proceeding brought in any such court has
been brought in an inconvenient forum. Process in any such suit,
action or proceeding may be served on any party anywhere in the world, whether
within or without the jurisdiction of any such court.
(b) EACH OF
THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY
IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY.
Section
5.10 . Counterparts;
Effectiveness. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument. This Agreement
shall become effective when each party hereto shall have received counterparts
hereof signed by all of the other parties hereto. Until and unless
each party has received a counterpart hereof signed by the other party
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hereto,
this Agreement shall have no effect and no party shall have any right or
obligation hereunder (whether by virtue of any other oral or written agreement
or other communication).
Section
5.11 . Severability. If
any term, provision or covenant of this Agreement is held by a court of
competent jurisdiction or other authority to be invalid, void or unenforceable,
the remainder of the terms, provisions and covenants of this Agreement shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated.
Section
5.12 . Specific
Performance. The parties hereto agree that irreparable damage
would occur in the event any provision of this Agreement is not performed in
accordance with the terms hereof and that the parties shall be entitled to
specific performance of the terms hereof in addition to any other remedy to
which they are entitled at law or in equity.
Section
5.13 . No Ownership
Interest. Nothing contained in this Agreement shall be deemed
to vest in Parent any direct or indirect ownership interest or incidence of
ownership of or with respect to any Shares. Except as otherwise
provided in this Agreement, all rights, ownership and economic benefits relating
to the Shares shall remain vested in and belong to the
Shareholders.
Section
5.14 . Amendment and
Restatement. This Agreement amends and restates, in its
entirety, the Original Agreement.
Section
5.15 Capitalized Terms; Other
Terms.
(a) Capitalized
terms used but not defined herein shall have the respective meanings set forth
in the Transaction Agreement.
(b) For
purposes of this Agreement, a person shall be deemed to “beneficially own” any
securities of which such person is considered to be a “beneficial owner” under Rule
13d-3 under the Exchange Act.
[Next page
is a signature page.]
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IN WITNESS WHEREOF, the parties hereto
have caused this Agreement to be duly executed as of the day and year first
above written.
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BANCO
SANTANDER S.A.
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By:
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Name:
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Title:
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_____________ Shares
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By:
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Name:
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Title:
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